$
GoModo Lottery
2026 Federal IRS & 50-State Tax Bracket Updates

Powerball & Mega Millions
Lottery Tax & Payout Calculator

Find out exactly how much you take home after the mandatory 24% federal withholding, the top 37% federal tax rate, and individual state taxes. Compare Cash Lump Sum vs. 30-Year Annuity instantly.

Live Winning Numbers
Auto-updated via GitHub Actions
P Powerball Latest Loading...
--
M Mega Millions Latest Loading...
--
$1,000,000,000 ($1.00 Billion)
$
Million
Estimated Lump Sum Cash Ratio: 50.2% (~$502,000,000)
40% (Conservative) Powerball ~50.2% Mega Millions ~48.5% 65%
0.0% Tax

California State Lottery winnings are 100% exempt from California state income tax!

Top 37% federal rate applies to income above $609,350 (Single) / $731,200 (Married).

Payout Comparison: Cash Option vs. 30-Year Annuity

Option 1: Lump Sum (Cash)
Paid Immediately
Final Net Take-Home Payout
$316,260,000
Effective Total Tax: 37.0% of cash value
Take-Home Federal (37%) State/Local
Gross Cash Value: $502,000,000
Federal 24% Upfront Withholding: -$120,480,000
Additional 13% Federal at Filing: -$65,260,000
State Tax: $0 (0%)
Initial Check Received (Day 1): $381,520,000
Option 2: 30-Year Annuity
30 Graduated Payments
Total Net Take-Home (30 Yrs)
$630,000,000
Full Jackpot Paid: $1,000,000,000
Year 1 First Net Payment: $9,482,400
Year 30 Final Net Payment: $39,028,800

Payments escalate by 5% every year to combat inflation across 29 years.

Total Advertised Jackpot: $1,000,000,000
Total 30-Year Federal Tax (37%): -$370,000,000
Total State Tax: $0 (0%)
Average Annual Net Payout: $21,000,000 / yr

Full 30-Year Annuity Payment Schedule

View individual gross, taxes, and net payout for each of the 30 annual checks

The 24% Federal Withholding Trap: Why Winners Owe Millions in April

When an American citizen or resident wins a major lottery jackpot exceeding $5,000, federal law requires lottery administrators to immediately withhold 24% for the Internal Revenue Service (IRS).

The Tax Reality Breakdown:

Any income exceeding $609,350 (Single) or $731,200 (Married Filing Jointly) falls squarely into the top federal marginal tax bracket of 37%. Since multimillion-dollar jackpots exceed this threshold almost immediately, the winner is responsible for the full 37% tax rate on the entire prize.

Result: On a $500 Million cash lump sum, the lottery withholds $120 Million (24%), but the winner still owes approximately $65 Million (the remaining 13%) when filing federal taxes the following April!

US State Lottery Tax Rates (Best & Worst States for Winners)

Where you buy your ticket and where you reside dramatically influences your final take-home fortune. State tax rates range from 0% to 10.9%.

Best States (0% State Tax on Lottery)

  • California: State Lottery winnings exempt by law (Cal. Rev. & Tax Code § 17082).
  • Texas, Florida, Washington, Tennessee: No state personal income tax.
  • South Dakota, Wyoming, Alaska, Nevada: No state income tax.
  • Delaware, Pennsylvania: State lottery prizes exempt from state income tax.

Highest State Lottery Tax Rates

  • New York: 10.9% state tax + 3.876% NYC resident tax (up to 14.776% total local).
  • New Jersey: 10.75% top state bracket.
  • District of Columbia (DC): 10.75%.
  • Oregon: 9.9% state withholding.
  • Minnesota: 9.85%.
  • Maryland: 8.95% (residents) / 8.0% (non-residents).

Step-by-Step Example: How a $1.0 Billion Jackpot Breaks Down

Step Category Cash Option (50.2%) 30-Year Annuity (Total)
1 Advertised Jackpot $1,000,000,000 $1,000,000,000
2 Gross Payment Value $502,000,000 $1,000,000,000
3 Mandatory 24% Fed Withholding -$120,480,000 -$240,000,000
4 Additional 13% Federal at Filing -$65,260,000 -$130,000,000
5 Net Take-Home in 0% State (e.g., CA / TX / FL) $316,260,000 $630,000,000
6 Net Take-Home in NY State (10.9%) $261,542,000 $521,000,000

Frequently Asked Questions (FAQ)

Q. Should I choose the Lump Sum Cash Option or the 30-Year Annuity?
Over 90% of past lottery jackpot winners choose the lump-sum cash option because it grants immediate control over the capital, allowing investments in diversified assets, index funds, or real estate. However, the 30-year annuity provides guaranteed, inflation-adjusted (5% compounding increase per year) income, protecting winners from financial mismanagement and sudden wealth bankruptcies.
Q. Can non-US citizens or tourists claim Powerball and Mega Millions prizes?
Yes. Non-US residents are eligible to win and claim prizes as long as tickets were legally purchased within a participating US jurisdiction. However, federal withholding for non-resident aliens is typically 30% upfront (instead of 24%), and bilateral tax treaties between the US and the winner's home country will govern additional liabilities.
Q. What happens to the remaining annuity payments if the winner dies?
Contrary to common myth, remaining annuity payments do not vanish or revert back to the state. The remaining stream of annual payments becomes part of the winner's legal estate and passes to designated beneficiaries or heirs.